THE MOTIVE FOR DEMONETIZING SILVER.
The motive for the demonetization of silver was precisely the same that had previously inspired the demonetization of gold. The object was to demonetize one of the metals—that metal which promised the greatest abundance, and which would contribute most largely to maintaining at an equitable level the general range of prices. The motive in both cases was to aggrandize the privileged classes—the income and the creditor classes of the world—and by means of a subtle and sinister manipulation of the money volume, whose effects it is not always easy to trace to their true cause, to practically confiscate the reward of the hard toil of the masses. To all intent and purpose the design was to establish a new system of slavery for the western world, of which the debtor classes among the white races should be the victims.
When demonetization was determined on there was no pretense that there was any difficulty in maintaining a parity between the two metals at the established ratio.
In the official résumé of the doings of the French monetary commission of 1869 the arguments upon both sides were summed up.
In behalf of the gold standard it was said:
The rise in price which has taken place within twenty years in a great number of articles of merchandise is evidently due to many causes, such as war, bad harvests, and increase in consumption; but it is very probable that the depreciation of the precious metals has contributed to it, since there has been a striking coincidence between the rise of prices and the production of the new mines of gold and silver. The annual production of the two metals, which was only $80,000,000 in 1847, exceeds now $200,000,000. It has nearly tripled, and it is easy to see that the real value of the metals has diminished. It is difficult to estimate exactly what the diminution is, but whatever it may be it demands the attention of governments, because it affects unfavorably all that portion of the population whose income, remaining nominally the same, undergoes a yearly diminution of purchasing power. As governments control the weight and standard of money, they ought so far as possible to assure its value. And as it is admitted that the tendency of the metals is to depreciate, this tendency should be arrested by demonetizing one of them.
In behalf of the double standard it was replied as follows:
Many economists argue that the precious metals, having become very abundant, have lost 10 or 15 per cent. of their value, and that the situation must be redressed by making money scarcer by demonetizing silver. To this it may be answered that the great discoveries of gold of the last twenty years have injured nobody. The new mass of gold, spreading over the whole world, has found employment in stimulating all forms of business, and, as a consequence, the value of gold has fallen very little. According to Mr. Newmarch, the mass of gold and silver has augmented 3 per cent. per annum, while the mass of exchanges has augmented more than 3 per cent. per annum, so that the equilibrium has been maintained. And the present is an especially inopportune time to demonetize silver, because the annual production of gold has been falling off for several years. It was $200,000,000 in 1853, and it is now not more than $140,000,000. What will happen to the civilized world if silver is demonetized and if gold shall then fail?
THE MOTIVE OF ENGLAND.
England did not adopt the gold standard until she was in a position to become the principal creditor nation. When her forges, furnaces, spindles, and looms were ready to supply manufactured goods to all the world, she saw that all countries and peoples would be compelled to pour their treasures into her lap. Her insular position and great navy guarantied her against external assault. Released from the anxieties and labors incident to the Napoleonic wars, with a sturdy population of trained mechanics, and with fields of coal and iron in abundance, she was well adapted to become the "workshop of the world." With colonial possessions in every sea, and with Continental Europe in ceaseless unrest, England could rely on customers who could themselves produce nothing but raw material and would be obliged to buy her finished products.